Guotai Junan Securities takes the first step in margin trading and stock borrowing & lending business for Qualified Foreign Institutional Investor (QFII) in the Chinese capital market

Guotai Junan Seurities facilitated Qualified Foreign Institutional Investors (QFII) to finalize the first ever margin trading and stock borrowing and lending business by foreign institutional investors in the China A Share market, with underlying stocks ranging from the Main Board, Growth Enterprise Market (GEM), Science and Technology Innovation Board (STAR Market) and etc.

QFII’s participation in margin financing and securities borrowing and lending businesses will be helpful in attracting more high quality capital into the market, improving the long-short balance of the market, expanding investment scopes, as well as increasing market activity. A more diversified set of investment tools will ultimately result in a more active and open financial market which will in turn become crucial new drivers for the financial market reforms and a robust financial system.

Following the “Measures for Domestic Securities and Futures Investment by Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors” issued by the China Securities Regulatory Commission (CSRC), the People’s Bank of China (PBOC) and the State Administration of Foreign Exchange (SAFE) on Sept 25^th, 2020, QFII is allowed to conduct margin trading and stock borrowing & lending business on Dec 29^th.

Guotai Junan Securities has been a long standing market leader in facilitating domestic and overseas investors to access the Chinese financial markets. The securities house is particularly experienced in margin trading and financing, stock borrowing and lending, and STAR Market stock borrowing. Guotai Junan successfully finalized the first ever securities lending transaction for QFII in China on Nov 2^nd 2020.